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Canada threatens trade war to protect dirty oil exports

Harper government threatens retaliation if European Union accurately labels oil from tar sands as highly polluting

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by Damian CarringtonGuardian, February 20, 2012

Canada has threatened a trade war with European Union over the bloc’s plan to label oil from Alberta’s vast tar sands as highly polluting, the Guardian can reveal, before a key vote in Brussels on 23 February.

“Canada will not hesitate to defend its interests, including at the World Trade Organisation,” state letters sent to European commissioners by Canada’s ambassador to the EU and its oil minister, released under freedom of information laws.

The move is a significant escalation of the row over the EU’s plans, which Canada fears would set a global precedent and derail its ability to exploit its tar sands, which are the biggest fossil fuel reserve in the world after Saudi Arabia. Environmental groups argue that exploitation of the tar sands, also called oil sands, is catastrophic for the global climate, as well as causing serious air and water pollution in Alberta.

Darek Urbaniak, at Friends of the Earth Europe, which obtained the new documents, said:

“These letters are further evidence of Canadian government and industry lobbying, which continuously undermines efforts to combat climate change. We find it unacceptable that the Canadian government now openly uses direct threats at the highest political levels to derail crucial EU climate legislation.”

The unveiling of Canada’s threats is the latest in a series of recent embarrassing revelations. On 12 February, the occurrence of a secret strategy “retreat” in London in 2011 was discovered. High-level officials discussed the “critical” issue of winning the tar sands argument in the EU, to “mitigate the impact on the Canadian brand” and to protect the “huge investments from the likes of Shell, BP, Total and Statoil”. Representatives of Shell, Total and Statoil attended the meeting alongside the UK’s state-owned Royal Bank of Scotland and the Canadian Association of Petroleum Producers.

In December, the Guardian revealed the secret high-level help given to the Canada by the UK government, which included David Cameron discussing the issue with his counterpart Stephen Harper during a visit to Canada, and stating privately that the UK wanted “to work with Canada on finding a way forward.” Canada’s minister for natural resources, Joe Oliver, stated: “[The British] have been very, very helpful.”

The UK proposed an alternative “banded” approach to ascribing carbon emissions to different fuel types, which does not single out tar sands. But environmentalists dismiss it as a delaying tactic and the Guardian understands that the UK has failed to present its proposal formally or provide supporting evidence.

In the newly released documents, Canada’s ambassador to the EU, David Plunkett, wrote in December to Connie Hedegaard, European commissioner for climate action, about the EU plans under the fuel quality directive (FQD).

“If the final measures single out oil sands crude in a discriminatory, arbitrary or unscientific way, or are otherwise inconsistent with the EU’s international trade obligations, I want to state that Canada will explore every avenue at its disposal to defend its interests, including at the World Trade Organisation.”

One Response to Canada threatens trade war to protect dirty oil exports

It is interesting, David Plunkett, Canada’s ambassador to the EU, said

“If the final measures single out oil sands crude in a discriminatory, arbitrary or unscientific way, or are otherwise inconsistent with the EU’s international trade obligations, I want to state that Canada will explore every avenue at its disposal to defend its interests, including at the World Trade Organisation.”

because absolutely nowhere does he mention anything to do with fears about the climate change impact of oil from the tar sands.